S&P 500 posts biggest weekly decline since 2012

US stocks ended lower for a second day and the S&P 500 posted its biggest weekly decline since 2012 today as concerns over Argentina's default continued to dog sentiment.

Data showing US job growth slowed in July and the unemployment rate unexpectedly rose suggested the Federal Reserve has room to keep interest rates low for a while.

The jobs growth, which came in below economists' forecasts, relieved some investors worried about how soon the Fed could bump up interest rates after data on Thursday showed US labor costs recorded their biggest gain in more than 5-1/2 years in the second quarter.

But concern remained over Argentina's debt problems after the country's default earlier this week. A US judge criticized Argentina's decision to default and ordered negotiations between the country and holdout investors to continue.

Seven of the 10 S&P 500 sectors ended lower, with S&P financials among sectors with the biggest losses. JPMorgan Chase shares were down 2.1 percent at $56.48.

The Dow Jones industrial average fell 69.93 points, or 0.42 percent, to 16,493.37, the S&P 500 lost 5.52 points, or 0.29 percent, to 1,925.15, and the Nasdaq Composite dropped 17.13 points, or 0.39 percent, to 4,352.64.

For the week, the S&P 500 fell 2.7 percent, its biggest weekly percentage loss since the week ending June 1, 2012. The Dow ended down 2.8 percent for the week, while the Nasdaq fell 2.2 percent.

The Dow's losses dragged it further into negative territory for the year. For the year-to-date, it is down 0.5 percent.

About 7.2 billion shares changed hands on US exchanges today, above the 6.2 billion average for the last five days, according to data from BATS Global Markets.

European stocks sank in huge volumes for the third straight session, with a broad index hitting a 3-1/2 month low, hurt by concerns over losses at Banco Espirito Santo as well as tension between Russia and the West.

The FTSEurofirst 300 index of top European shares ended 1.2 percent lower today, at 1,332.68 points, a level not seen since mid-April.

"The situation in Argentina, the problems with Banco Espirito Santo and geopolitical tensions, particularly with Russia, are fuelling this bout of profit taking," Barclays France fund manager Philippe Cohen said.

Japan's Nikkei share average dropped to a one-week low hit by concern that US interest rates could rise sooner than expected, but strong earnings from companies such as Sony Corp limited the losses. The Nikkei ended 0.6 percent down at 15,523.11, the lowest close since July 25. For the week, the index rose 0.4 percent and posted a third consecutive weekly gain.